Saturday, 7 September 2013

Canada's Professional Crystal Ball Gazers Get It Wrong.

For the fourth time in seven months, the Canadian economy
has shed jobs, pushing the jobless rate in July up to 7.2 per cent.

Statistics Canada reported Friday that the economy lost
39,400 jobs last month, pushing the unemployment rate up 0.1 percentage points
to 7.2 per cent.

Much of the decline came from the public sector, where there
were 74,000 fewer jobs. The private sector and the ranks of the self-employed
both increased slightly.{...}

The poor jobs showing was a huge miss compared with the gain
of 17,000 that economists were expecting.{...}

"Aside from providing great sport and serving as an
eternal source of embarrassment for forecasters, do the wild gyrations in
monthly jobs actually mean anything for the economy? Not really," BMO
economist Doug Porter said of the data.

Yet still, when they make projections about the character of the labour market ten, fifteen, twenty years in advance we're supposed to take their word for it. I take the Weather Network's short-term forecasts with a grain of salt. I have little reason to believe what some overpaid, over-educated putz in an expensive business suit sitting in some office in a bank tower thinks the future will look like in ten years.

They are employed in these positions - and paid handsomely too - because they are able to convince people that they know what they're talking about when in fact they don't. People fear uncertainty and want to know what decisions to make today to affect a fortuitous outcome in the future. And they're willing to pay for it.

No one can predict the future. No one, yet the government has shaped immigration policy around what these occasionally-right-by-way-of-a-lucky-guess palm readers say about labour market trends. They are wrong often enough that we shouldn't be listening to them at all and it's a very real possibility that the future Canadian labour market they predict - one that necessitates the highest immigration intake quotas in the world - will not come to pass. If so we are in the process of stock piling a labour force of which supply exceeds demand and with this comes a bevy of social problems.